Hiring Freeze

What it is:

A hiring freeze is a temporary cessation in hiring new employees.

How it works (Example):

Let's say Company XYZ is running out of cash and needs to conserve in every way it can. To avoid laying off employees, it institutes a hiring freeze, meaning that any open positions at the company will remain unfilled until further notice.

Why it Matters:

Hiring freezes are methods of conserving cash and are almost always a reflection of financial issues within a company. They can strain morale, however, because employees may have been counting on hiring new employees to relieve backlogs, overloads or skills shortages.

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